tv World Business WHUT October 13, 2009 6:00pm-6:30pm EDT
>>abirached: this week on world business >>: africa comes of age - despite the global recession with record fdi and a wealth of natural resources, the continent is being taken seriously by the commercial world. >>: it is the ivate sector at the end of the day that will produce goods for trade within the continent. >>: across the world the car industry has stalled, but one little factory in slovenia is still going flat out. >>: and demand for super yachts has reached such levels that the real battle is now to find a berth. >>: the waiting lists are huge. you could wait for a decade to get a berth annually and you're not sure to get one.
>>abirached: hello and welcome. i'm raya abirached and this is world business, your weekly insight into the global business trends shaping our lives. for years, development assistance to africa has been a key topic at global summits... most recently during the g20 in pittsburgh. but times have changed. as the global recession cast its shadow... aid has dipped. but africa still boasts a wealth in raw materials leading to record foreign direct investment in 2008. and its broadband infrastructure was recently boosted with the completion of a $650 million fiber optic cable. african stakeholders are increasingly working towake the sleeping giant... and the private sector role has become critical in driving change across the continent.
>>reporter: the city of jinja in uganda... the source of the nile. it is here where savenet sacco provides micro-credits to entrepreneurs... on average between $300-500. michael balyakumaani is one of the beneficiaries. he runs a small bike taxi business... the so-called boda-boda. >>balyakumaani: before the loan i had this bike. and then i got the loan and was able to buy the other bike. >>reporter: michael is one of over 40 loan clients of savenet sacco... whose business is growing thanks to computers... allowing the company to streamline operations, offer better services and manage loan repayments. >>ezaru: now when we make reports every month, we see which clients are performing well and which ones are performing worse. >>reporter: in uganda... ict has become a key pillar for
development... and public private partnerships are driving this change. an initiative by the united nations industrial development organization and microsoft helps small and medium sized businesses, like savenet sacco, purchase affordable, brand-name computers. uganda green computer company refurbishes computers from the u.s., europe and local sources... loadsthem with genuine windows software and then sells them for just $175 and a one year warranty... helping to narrow uganda's digital divide and develop the country's local ict economy. patrick bitature launched the company in july 2008. >>bitature: it's really about partnership. it's something we couldn't have ever done on our own because we needed different stakeholders to be involved, everyone to believe in this and see that we can do something in a sustainable manner, make it profitable and have a big social impact on the community.
>>reporter: creating win-win partnerships was the theme of the eu - africa business forum... aimed to improve the business climate in africa and promote investment. >>sager: the meeting here in nairobi convenes during challenging times, with economic growth in africa expected to be 2.8% in 2009, following five consecutive years of growth above 5.5%. >>reporter: however, while world foreign direct investment declined by 20% in 2008, inflows into africa were up by over 16% to nearly $62 billion... due to the surge in prices for raw materials. in an effort to steer away from predominantly commodity-related investments... and diversify their economies... participants called for greater regionalism... planting the seeds for a future common market. >>mudavadi: it is high time that africa advocates for a trading bloc in line with the european union which has been very
successful since its inception. it is imperative to note that it is through the trading bloc as a union that we are going to achieve prosperity, well-being of the people, and development in the african region. >>reporter: it would further offer a buffer against economic downturns. >>mwencha: europe has performed much better because there is a lot of intra-european trade taking place and africa could borrow relief from this to see that we strengthen regionalism, we strengthen communicationin africa, we strengthen the privatsector, because it is the private sector at the end of the day that will produce goods for trade within the continent. >>reporter: the secretary general of the common market for eastern and southern africa reiterated the importanceof developing regional markets. >>ngwenya: investors are also not going to come to markets where the intra-regional trade is low. investors will come when
we begin to be like asia. >>reporter: the eu - africa's largest trading partner - has pledged over $7 billion in funding, out of which more than ú2 billion are designated for regional integration. >>manservisi: now more than ever we need good policies in place, a good enabling framework in place which is for the public, for the state, for the policy making, and private sector fully exploiting having access to credit, having access to knowledge, having access to skills in order to take on all these challenges together. >>reporter: the recent completion of the first fibre-optic undersea cable - costing $650 million and partly funded by the eu - connecting east africa with the rest of the world and providing high-speed internet access... has further boosted the region's industry and commerce. >>: the european commission is calling on private companies to contribute expertise for ict applicationsand interconnectivity. >>diarra:
ict usage is something new on the continent. and a lot of people still don't realize that in, fact, when you are called upon to be more productive, to be more effective, more efficient, especially during this time of crisis that is the best time actually to call on ict to help you actually meet those challenges. >>reporter: at uganda green computer company this plea has been answered. more than 600 computers are refurbished and sold every month... enhancing africa's capacity for development. >>bitature: a seed was sown at this time in this area and it has grown into a fantastic tree that has brought benefits to everyone in the region. >>abirached: the car industry has been one of the sectors worst hit by the global recession and governments around the world have been scrambling to boost falling sales. but for one firm in slovenia, despite the crisis, production is still running at full capacity.
>>reporter: novo mesto in the south west of slovenia is home to at least three of the most successful brands in the country: krka, a pharmaceutical company, adria mobil, a caravan maker and revoz, a car manufacturer owned by the french group renault. >>reporter: in 1973 renault shifted some of its output to this lower-cost plant, currently producing twingo and clio models and employing nearly 3,000 people. >>: but just like many other manufacturers, at the end of last year revoz felt the pinch of the recession. >>bratoz: we were touched of course by the crisis, the economic crisis. in the end of last year we were reducing our production level
and we were working only for 8 days in december. >>reporter: since then the plant has also fallen foul of protectionism by the french government, which provided aid to its national car firms only on the basis that jobs were kept in france. renault responded by creating 400 jobs on the clio production line back he rather than here. yet despite this, the slovenian plant is still running 24/7. >>bratoz: i can say that we are glad, we are lucky to produce small vehicles, vehicles with small levels of co2 emission, which are vehicles, which are the best results concerning some scrapping incentives.
>>reporter: good news for both the plant and the town. whilst many other businesses in novo mesto slash working hours, revoz increased its production in april, making employees like bojan kobe and his wife marica more confident about their future. >>kobe: considering the current situation there's absolutely no fear that we might loose our jobs, we have alot of work going on. if we had the capacity, we could probably produce more. we are all working inall 3 shifts, which is the maximum for this plant. >>reporter: however - while their jobs might be secure, the workload for many is becoming too much. >>pungersic: the pressure comes from the fact that the factory has a large workload and that we are working at full capacity in 3 shifts and the pressure is high. some workers are finding that hard.
>>reporter: revoz produces mainly for the european markets - with a mere 4% of production staying in slovenia, but even so, the cars made here are doing well at the local car dealer. >>kocjan: there was a large drop in sales of more expensive cars whereas sales of smaller cars such as the renault twingo, clio and modus haven't seen such a steep drop. >>reporter: this is in line with other european countries where the sales of luxury cars have been hit hardest as consumers continue to tighten their belts. but yet the demand for small green vehicles in novo mesto is not linked to a scrapping scheme, which the government decided not to pursue. >>suhorepec: the slovenian government decided not to launch it in 2009 and neither in 2010 for the time being. they said
in fact that the market is a little bit too small and they have other priorities. we are definitely convinced that the sales would go up if the scheme would be put in place because this is thecase all over europe, but unfortunately for slovenia it's not the case. >>reporter: the outlook for revoz seems to be more optimistic than last winter, but the mood amongst employees remains realistic. >>bratoz: it's positive, but our people, our employees are worried like all the others because they see what happens around them. >>reporter: and perhaps with that in mind, slovenia's government just announced 20 million dollars in state aid for the production of a new small nault vehicle. >>: with luck even busier times may be ahead for the novo mesto plant. >>abirached: still to come on world
business... how nascar is fighting to keep the power on despite the recession. >>: there's over 400 sponsors involved in nascar, which makes it the most corporate involvement of any sport in the united states. >>: superyachts are still selling by the boatload but finding a mooring is more of a challenge. >>: there simply aren't enough berths. everyone wants to be here permanently, preferably. >>: a quay is the key... and the rest in just a moment on world business... >>abirached: at the end of last month, everyone who was anyone in the boat business headed down to the monaco boat show. the show is the industry's most important and held in a region that is the natural home of the luxury yacht. but there is a storm brewing in the south of france. seemingly insatiable demand has pushed production of superyachts
to such levels that there is now literally no room to accommodatethem. what matters now is not whether you can afford the boat, but whether you can buy a berth. >>reporter: the maltese falcon, a state-of-the-art super yacht and one of the ultimate status symbols. the cote d'azur is the destination of choice for these marine behemoths and ase yachts get bigger, and fatter, marinas are stretched to breaking point. >>steve: the average is around 70 demands by day and we increase this level during the summer. ... it's a real challenge each day to manage these berths. >>milns: antibes marina is one of the biggest and most popular and whilst it is possible, just about, to renta berth space on a short-term basis, if you are looking for a long-term solution,
the preferred option, albeit an extremely expensive one, is to buy a lease. >>murray-kerr: all the phone calls i get are for the south of france, they simply are not enough berths. everybody wants to be here, permanently preferably, but the waiting lists are huge. you could wait for a decade to get a berth annually and you're not sure to get one. the best way to short-cirit the waiting list is to buy a berth. you buy a berth then you can expel the tenant and you can use the berth yourself... >>reporter: however, most of the leases are due to run out in 10-15 years when the marinas return to state ownership. the plan is that current owners will get priority to rent their old berth, for a similar rate to their current service charge but there's no guarantee that this will be the case. >>murray-kerr:
you never know who's going to bin power in the next decade so it is a bit of a question mark here. >>reporter: despite this uncertainty, the prices are as extravagant as the yachts themselves. here a short term lease starts at $750,000 for an 80 foot yacht berth but can get much, much higher. >>: it may only be a difference of 100 m but while it's free to drop your anchor over here, over here onthe quai de milliardaires, or billionaires quay, are some of the most expensive and sought-after berths on the entire cote d'azur. the last one sold back in 2008 for a staggering $21 million. >>: the cote d'azur commands such high prices because, despite the lack of space, the south of france has the necessary supporting infrastructure. >>gartner: there is a lot of people around here who know how
to work on these boats, supply the services. it's really important just to have some place to go and it's getting harder and harder to find thesplaces as boats are getting bigger and bigger. >>reporter: and it's not just about the length, width is equally important. >>certaldi: one major point is the beam of the boat. we had 10 years ago boat of 40 m with an 8 m beam for example now we can have a boat on the same berth of 12-14m beam so obviously one boat is taking 2 berths. >>reporter: it is a factor that is increasingly affecting sales of the yachts themselves. >>seal: on occasion we've had people who won't commit to buying the yacht until we found that the berth for the yacht, so that can slow things down even stop the sale from happening. >>reporter: even so, even if worldwide yacht orders stopped today, the backlog is such that there would still befour yachts
over 80 feet being delivered every week for the next four years. when the demand so clearly outstrips supply, the solution would appear to be obvious, increase the supply. hover, the french government will not allow any more development. italy and spain however are both building new marinas, and puerto montenegro is an ambitious new project on the adriatic coast. it has the potential capacity for 650 berths, including 150 super yachts. >>corlette: prior to our taking over is that it was set up for naval frigates and so the infrastructure that's in place - the docks themselves are between 15 and twenty metres wide. and for these large yachts, the super-yachts from 100 metres up to 130 metres. they need this kind of heavy duty infrastructure for the provisioning, the fuel trucks and for the yachts themselves to tie up. >>reporter: and by transforming spartan military facilities into a chi-chi harbour
for the jet set crowd it's a project that has got sea legs. >>murray-kerr: the project has huge potential. the adriatic coast is pretty much what the cote d'azur was 50 years ago, all you need is a bit of infrastructure and ... a modern day brigitte bardot to put it on the map. >>reporter: and with yacht construction showing no sign of slowing down, an investment here could prove real shelter from our recessionary storm. >>abirached: and roman abramovich will soon take delivery of the world's biggest private yacht, eclipse. the boatis 557 feet long and will cost well over a billion dollars. the national association for stock car auto racing, has truly been a sporting success story. from humble beginnings in the usa's south eastern states, over the past 60 years, nascar has risen to become a behemoth of american sport. today it has the longest season of all the professional sports
in america, and its races draw the biggest crowds. but it's heavily dependent on sponsorship, and a car industry sent reeling by the global economic crisis. we took a look at just what makes nascar special, and how it's coping with the recession... >>reporter: there's plenty of sporting entertainment on offer in the usa...little of it, however, as popular as the races laid on by nascar... >>giangola: if you look at attendance overall, the 20 largest sporting events in the united states this...17 of those 20 will be nascar races. so these are mega events. >>reporter: events that pull in over 7m passionate fans a year... >>: i save all winter. but then i...this is what i do. >>: we make it one way or another. its something we wou >>curtis: we have all 50 states represented here. 25% of our crowds from canada, 60%
comes from out of state. >>reporter: and where there are fans...there are sponsors...ones that last year injected around $1.5b into the sport... >>owen: there's absolutely no better venue out in america today to get your name in front of large audiences. 100000 people a week can come out to these things that attend...and then you've got millions and millions of more viewers that are at home. >>giangola: there's over 400 sponsors involved in nascar, which makes it the most corporate involvement of any sport in the united states. >>jong: well. i guess the best way to describe this experience is with a few numbers. basically, if you've got 43, 800hp cars going round a 2 mile track at about 200mph in front of over 100000 fans...its brilliant. its absolutely brilliant. >>reporter: and deceptiveldifficult... >>edwards:
i can understand...it looks like we're just driving round in circles...//..the thing that's going onthat's hard to see on television is the whole time we're cornering is you're getting the most grip out of the car..so the car is sliding the whole time. >>vickers: smaller tis, very little down force and a very heavy car...so it's a very difficult car to drive. >>reporter: and in the midst of a recession, nascar itself is finding things a little difficult...for starters, the sport's four car manufacturers have made heavy spending cuts this year. gm and ford by 20%...chrysler 30% and toyota by an undisclosed amount. tv ratings are down almost 20% on 2005's high water mark and attendances have fallen for four successive years... >>wolfe: when you look at most sports attendance is off a bit...with so many opportunities available for consumers to watch on television, television is down a bit, but not more so than any other major sport. >>giangola: we're seeing a slight softness in attendance. declines are in the single digits. >>reporter: meanwhile teams, which need
to rustle up around $20m a year to be competitive, have found the sponsorship money that makes up about 3/4 of their income, harder to come by... >>stewart: instead of necessarily having a 38 race season where they have one particular sponsor for 38 races. some of them now will sell a sponsorship for 20 races, and then another for 10, and then another for8. >>reporter: over the last decade, nascar has been the fastest growing sport in the usa. in 2005 it signed an 8-year, $4.5b broadcast contract. but now it may have to work a little harder to sell itself... >>curtis: i don't want to say there was complacency...but we certainly were on a huge growth curve. now its time to pause and take stock and recall why are we here. >>reporter: one idea reignited by the recession has been that of a franchise system which would guarantee licensed teams an appearance on race day, important for sponsorship income and stability. currently teams need
to qualify. but it's unlikely to happen...firstly because nascar is a family run, benevolent dictatorship that could see its authority diluted by franchisees, and secondly.... >>stewart: the history of this sport has been the total opposite of that. it's been about a guy that has a shopdown the street that builds a car and can enter it just like anybody else. so i don't know that they'll ever really get away from that model. >>reporter: but nascar isn't averse to radical change. 2 years ago, for example, it introduced the car of tomorrow - a standard design to be used by all teams, created to cut development costs, and encourage more competitive racing....critics however, say it's just made passing more difficult, and racing less exciting, by artificially squeezing thfield together.... >>wolfe: i know it's a bit more difficult for the drivers to pass and it makes it a lot more challenging but om a fan perspective your team could be right there to the end. >>reporter: of course, nascar is still in a position many other sports can only envy.
in the usa only the nfl draws more tv viewers, while average attendance thru its 10 month season is still well over 100000. and speing from personal experience, you'll be hard pressed to find a more dedicated, enthusiastic, and friendly bunch of fans... >>: what's this game called? >>: cornhole. >>: cornhole? why's it called cornhole? >>: because the corn in the bag's gotta get in the hole. cornhole. >>: this is a popular game at the nascar? >>: it is. >>: hello sir...tell us your name. >>: tim thiry... >>: tim what are you doing here and you've got a lovely bui see. >>: belgian by ancestry. >>: you pretty good at the corn hole? >>: not bad. >>: that went straight in. >>reporter: as for the drivers, they're an accessible lot, and having taken a brief spin in the pace car, i could see the attraction of an adrenaline fuelled career based on hurtling around a steeply banked oval... >>: you make a good living? >>edwards: yeah i make a great living.
>>stewart: it's a great sport. it's an awesome sport. >>reporter: a sport however, facing something of a slowdown, before it gets back into the fast lane. >>abirached: and nascar has an unusual origin dating back to the prohibition era in the us. bootleggers would usesmall powerful cars move their moonshine whiskey, to help them out run police on windy appalachian mountain roads. that's it for this week's world business. thanks for watching. we'll see you againat the sameime next week.